Brazil's JBS Reports 'Best Quarter' As Net Income Rises 30%
JBS SA, the world's largest meatpacker, said it had the best quarter in its history, according to an earning statement, posting net income that rose almost 30% to 4.382 billion reais (€720 million).
Results were bolstered by its thriving meat business in the United States and resilience in the Brazilian market, where higher feed prices drove up production costs.
"This quarter was the best in sales, in net profit and the best in operational terms of EBITDA," CEO Gilberto Tomazoni said.
Earnings before interest, tax, depreciation and amortisation, a measure of operating income known as EBITDA, came in at 11.7 billion reais, well above an average forecast 8.973 billion reais (€1.46 billion) by three analysts.
In North America, the quarter was marked by strong domestic and export demand, which supported the price of meat at historical highs and provided healthy margins in the United States and Canada, as the effects of the pandemic subside and consumers returned to restaurants.
JBS also said sales volumes and revenues from its Canadian and US beef exports grew significantly from the previous year, driven by shipments to China.
Overall, the Asian country bought nearly a third of JBS'meat exports in the second quarter.
The company showed top-line growth across the board, with net revenue reaching 85.6 billion reais (€13.97 billion) last quarter, up almost 27%.
On the other hand, JBS said cash flow from operations slumped nearly 50% to 5.8 billion reais (€950 billion), impacted by the growth of "accounts receivables" and higher inventory related mainly to its Brazilian business.
At the same time, its Seara pork and poultry division in Brazil faced higher production costs as soymeal and corn prices sky-rocketed.
The company said this was partly offset by its ability to pass on higher costs to consumer prices.